•  Income Share Agreements

Edly Review

edly is an alternative investment platform offering “income share agreement” investments in the future earnings of college students. Target returns are about 12%, with monthly payments and a 4-year expected hold time.


  • Founded: 2019
  • Investment Types: Income Share Agreements
  • Sectors: ISA
  • Minimum Investment: $10,000
  • Advertised Returns: 12%
  • Must be accredited
  • Monthly cash flow
  • Managed portfolio option for easy diversification
  • Interactive calculator to model repayment scenarios
  • Relatively high minimum investment
  • Limited selection of offerings
  • Only open to accredited investors


This edly Review will help you learn more about edly's investment offerings, including how the alternative investments on edly are structured, and what your potential returns might be. You can read more about the criteria we use to review investment platforms here.

edly offers investors access to “Income Share Agreements” (ISAs) which some schools offer students as an alternative to private loans. Instead of taking out a loan to pay for tuition, the student agrees to pay a portion of their future income (subject to various minimums and limits). edly investors choose and buy pools of these ISAs from the schools (or loans backed by them) on the edly platform, or via a managed portfolio of multiple ISA pools curated by edly.

edly was founded in 2019 by Charles Trafton and Christopher Ricciardi, two managing partners at FlowPoint Capital Partners, an investment firm specializing in ISA investments. Ricciardi has been a banker at Merril Lynch and Credit Suisse, and has experience with multiple structured debt instruments, including CDOs (collateralized debt obligations) and CLOs (collateralized loan obligations).

Schools have offered ISAs for some time, but the number available is often limited by the school’s cash flow. Being able to resell the ISA via edly means the school can put that cash back into new ISAs for other students.

Investments on edly are offered under SEC Reg D and available only to accredited investors.

Is edly legit?

Yes, edly is “legit” in the sense that it is a legitimate, regulated business and a legitimate alternative investment oppoortunity for accredited investors.

edly is among a growing crop of crowdfunding and online alternative investment platforms, most of which have launched in the wake of the 2012 JOBS Act.

Types of investments edly offers

The primary offering right now on edly is their “Outcomes Strategy” managed portfolio option. For a $10,000 minimum, investors get a fractional interest in a portfolio of ISA pools as well as loans to schools backed by ISA contracts. The portfolio offers exposure across schools and school types (Healthcare, Vocational, University, and Technology), with a 4-year hold time.

What do you get when investing with edly?

Investors in the “Outcomes Strategy” offering receive membership in an LLC that in turn holds a portfolio of ISA pools and loans to schools backed by ISA contracts. ISAs are somewhat similar to the revenue share investments in businesses available from some other platforms, such as NextSeed, and also share some similarities with the “borrower payment dependent notes” offered by platforms like Groundfloor.

How does edly make money?

edly charges investors 4% of the ISA cash flows. edly also charges schools 4%, along with closing costs (1-2%).

Potential returns and cashflow

Investors receive monthly cash distributions. Because the payment amounts from graduates within the ISA pools depend on income level, the monthly distributions will vary (and graduates are not obligated to pay anything in months where they have income below certain thresholds). edly says their target duration is 4 years, and they “seek to return all investor money within 5 years”.

edly provides some calculators and models to illustrate monthly cash flow based on various scenarios. Investors should note that ISAs have a cap on the total return (typically a multiple of the tuition amount paid) as well as a maximum duration.

Breadth of offerings on edly

As of this writing, the only available offering from edly is the “Outcomes Strategy” managed portfolio. Previously, edly has offered access to individual ISA pools and loans to schools backed by ISA contracts. According to edly, they expect to originate $60 million in ISAs and ISA-backed loans in 2020.

Regulatory framework

edly offers investments using SEC Reg D, and currently only offer access to accredited investors. edly is not a registered broker-dealer, and does not list any affiliation with one on their website.

According to edly, their screening approach includes assessing things like graduation rates, employment rates, time-to-employment, starting salaries, salary increases over time, and non-payment rates. Notably edly says that in order to increase access to students from all backgrounds, they do not use traditional credit scoring tools like FICO scores:

edly analyzes the historical outcomes of students as captured in data about the schools, the area of study, and geography. We look for an attractive relationship between the tuition of the program and the student outcomes. The higher the “ROSI” (Return on Student Investment) the more attractive it is to edly.

This review was first published on 09 June 2020.

Our Rating

Very Good

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